With the economic recovery, business travel will also increase again this year. Yet this will not necessarily lead to increased spending on business travel. This was stated by Sasja Winters (ING Bank) at the Glomex New Year Event, where the latest developments in the field of mobility in business travel were presented. Economic growth for 2016 is estimated at 2.5 percent. In the export volume, an increase of 4.8 percent is expected.
The event is organized annually by founders Carla van den Berg-Brantjes, Huub Smeets and Herman Huijer and took place this year at the Radisson Blu Airport Hotel in Amsterdam.
Speakers Liam Donnelly (Director Arval Netherlands) and Sasja Winters talked about the changes in business traveler behavior and the mobility landscape.
Liam Donnelly: need for business travel diminishes
The rise of technology is reducing the need for business travel. Employees are showing more interest in mobility budgets and carpooling, reports Liam Donnelly general manager of Arval Netherlands. These budgets give the employee the flexibility to choose their own mode of travel. This forces the employee to look beyond the traditional car arrangement. A company lease car is no longer a prominent employment benefit. ‘Although I don’t think the company lease car will disappear completely. Employees simply like good working conditions,’ Donnelly said. ‘What we have been expecting for years is now happening. The thinking of our employer is changing.’
As a trend, Arval’s managing director describes the input of technology. Conference calling facilities such as Skype make it less necessary to travel for work. The need to meet face-to-face is shrinking. ‘Look at Uber, that also runs through an app. You feel more and more comfortable using an app,’ says Donnelly. All automakers are currently working on self-driving cars. ‘Through the Uber application, you book a car with a driver. But when technology gets to that point, soon you’ll just have the car that takes you from A to B,’ Donnelly said.
In the last quarter of 2015, Arval launched the digital platform Arval Mobility Link on which all possible national forms of mobility offered to employees are measured. This allows the mobility behavior of all employees to be mapped and not just the lease drivers within a company. With this, Arval can advise an organization on Total Cost of Mobility (TCM), in addition to Total Cost of Ownership (TCO).
Sasja Winters: Low cost carrier increasingly popular
Travel Management Company (TMC), which provides corporate travel management for organizations, is more heavily influenced by developments in aviation. This is according to research by ING. As a result, the revenue model is under pressure. Although the airline industry is doing better, the net profit margin is just above zero percent. This is in contrast to the profitable low cost carriers. By reducing distribution costs, airlines are trying to increase their profitability.
“There is a trend of disintermediation emerging in many service industries through the use of technology,” says ING’s Sasja Winters. TMCs can add value as advisors.
Business travel is expected to increase this year, given the expected economic growth of 2.5 percent and a 4.8 percent increase in export volume. Although this growth does not directly result in higher spending. In October 2015, the Global Distribution System(GDS) at Lufthansa recorded a 10 percent decrease in tickets booked, while market demand increased by 7.8 percent. The decrease was a result of the introduction of a GDS surcharge of 16 euros per ticket. Low cost carriers are becoming an increasingly attractive alternative for the business traveler.
Herman Huiijer appointed Honorary Partner
Co-founder of Glomex Herman Huijer, was named an Honorary Partner during the New Year Event. The business travel professional must resign his position as managing partner within the network organization due to health reasons. The former president of NATM, won the MICE Personality in 2014, was active in the international GBTA and taught at the World Travel School.
Photo from left to right: Herman Huijer, Carla van den Berg-Brantjes and Huub Smeets.
